Gilead Sciences Inc. (GILD: Quote) said Thursday its first-quarter earnings dropped from last year, due mainly to costs related to its January 2012 acquisition of Pharmasset Inc. Nevertheless, revenue for the quarter rose 19 percent from last year on robust sales of its lead antiviral drugs Atripla and Truvada in the U.S. as well as in Europe. Gilead's earnings for the quarter missed Street estimates, while revenue topped expectations.
Detailing its topline, Gilead said sales of its antiviral products in the quarter rose 18 percent from last year, with U.S. sales surging 24 percent and Europe up 7 percent.
Sales of HIV drugs Atripla grew 19 percent from last year, and Truvada by 13 percent.
The FDA in February accepted Gilead's supplemental New Drug Application for once-daily Truvada for pre-exposure prophylaxis to reduce the risk of HIV-1 infection among uninfected adults. The FDA is set to review the sNDA by June 15, 2012.
Gilead also indicated growth in other drugs that account for a lesser part of its business. Sales of HIV and chronic hepatitis B drug Viread grew 14 percent from last year. The FDA in January approved Viread in combination with other antiretroviral agents for the treatment of HIV-1 infection in pediatric patients ages 2-12.
Sales of Complera, a relatively new drug, doubled from the sequential fourth quarter to $52 million. The FDA approved the drug to treat HIV in patients new to therapy last August. The drug also has been cleared in the European Union under the name Eviplera.
Sales of Letairis for treatment of pulmonary arterial hypertension jumped 40 percent from last year, and chronic angina drug Ranexa grew 22 percent. Sales of other products were slightly up compared to last year, while royalty and other revenue rose 19 percent.
Gilead continued to face margin pressures, with product gross margin for the quarter dropping to 73.7 percent from 74.6 percent a year ago. Operating margin shrunk to 35.1 percent from 46.8 percent.
Gilead incurred stock-based compensation expense of $194 million related to the acquisition of Pharmasset in January.
Foster City, California-based Gilead reported first-quarter net income of $442 million or $0.57 per share, compared to $651 million or $0.80 per share last year.
Excluding items, adjusted earnings for the quarter were $704.4 or $0.91 per share, compared to $703 million or $0.87 per share last year.
On average, 25 analysts polled by Thomson Reuters expected Gilead to earn $0.94 per share for the quarter. Analysts' estimates typically excludes special items.
Gilead posted first-quarter revenue of $2.28 billion, compared to $1.93 billion last year. Analysts expected revenue of $2.2 billion.
GILD is trading at $52.72, up $0.15 or 0.29%, on a volume of 6.7 million shares on the Nasdaq. In after hours, the stock dropped $0.32 or 0.61%. In the past year, the stock has ranged $34.45 - 56.50.
by RTT Staff Writer
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